9:29 am, June 12, 2023
Dealer group Hartwell enjoyed a modest rise in profits last year despite bosses raising concerns over new vehicle supply.
Documents published via Companies House show that the 104-year-old outfit made a pre-tax profit of £3.18m in the 12 months to November 30, 2022.
The figure represents a rise of around 1.4 per cent compared to the previous year, when the group made £3.14m.
The year was a significant period of change for the Oxfordshire-based dealer group, with bosses taking the decision to purchase all its sites from previous landlords at the end of the previous reporting period.
The firm, which runs 11 Ford dealerships, and another multi-franchise site, bought all the premises at book value, except for its Reading showroom, which it already owned.
Buoyed by the new strategy, 2022 saw Hartwell’s turnover rise to £230.3m last year, compared to £225.1m in 2021.
The period was also the first full financial year not to be impacted by Covid-19 restrictions since before the pandemic.
However, the fallout from Coronavirus did continue to impact business as the global semi-conductor shortage led to ‘serious challenges’ when it came to new car stock.
In a statement included as part of the accounts, director Atiq Rehman, said: ‘A combination of strong pent up demand for used cars and service and repair work, plus efficiencies made by the company during the Covid-19 pandemic allowed for a strong financial performance. The efficiencies were predominantly brought about by move towards digitalised systems, replacing paper based processes.
‘A continued shortage in the global supply of semiconductors continued to present a serious challenge in relation to the availability and supply of new vehicles. Albeit that some of this was offset by a reduction in stock finance charges as we held less consignment stock than we would have done otherwise, and some customers unable to wait for a new vehicle, purchased used vehicles in their place.
‘A significant change to our operating structure is that, as reported in last year’s financial statements at the end of the previous financial year, the company purchased all of the sites from which it operates its dealerships from its landlords (save for Reading that it already owned).
‘The sites were purchased at current book value and clearly represent a significant investment for the company. As a result, the individual sites are no longer liable to pay annual rent.’
Of the improved turnover, around £221.5m was raised from vehicle sales, with aftersales bringing in a further £7.95m.
Elsewhere, the group paid £12.9m on wages and salaries throughout the year with staff numbers rising to 366.
Going forward, the group is looking to continue growing as is hoping to achieve this by offering ‘market-leading’ low rate finance.
Rehman added: ‘The strategy to promote growth remains a strong focus on driving sales complemented by heavy emphasis on offering low rate finance to customers via its partner Santander Consumer Finance, an industry leading 4.9 per cent representative APR in this financial year.
‘Tight controls over cost and stock maintain strong margins and the directors intend to maintain and enhance this strategy.’
